Excess inventory is a problem you can count on everyone having. It’s usually very low on the priority list and added to someone’s already existing job title. It just doesn’t get viewed as being important. Even the thought of it causes my brain to hurt. But, the fact is, excess is very important. In fact, dealing with it now is both advantageous for space and bottom line financials. Check out the below case study for an asset recovery solution. Having a program like this one, may just get you to rethink your next excess materials headache.
Like many OEMs, excess inventory management was not a top priority for this manufacturer of medical devices. Excess inventory is inevitable due to inefficiencies that are present in all supply chains. At some point though, every company, including this OEM, is faced with how best to recapitalize the disposition.
Initially, this OEM made efforts to sell their excess inventory in bulk by obtaining lot bids. The process sounded easy; however, the bids were extremely low: in the 4 to 6 cents on the dollar range, which was much too low for this OEM.
The OEM reached out to EDX for a solution. EDX’s first step was to perform an inventory recommendation report. Utilizing EDX’s big data that tracks over 25 million components daily and has almost 8 billion rows of historical trending data, the recommendation report revealed that a large portion of the list was saleable.
The OEM and EDX entered into a revenue sharing consignment agreement. EDX paid for the shipment of excess inventory and took delivery at one of EDX’s climate controlled warehouses. The inventory was inspected and a reconciliation report was provided.
To maximize the return EDX utilized a unique, targeted marketing approach leveraging several platforms and a global sales infrastructure that is backed by over 25 years of global commodity management expertise.
Our customer concluded that EDX’s Asset Recovery service not only returned multiple times in revenue what the lot bid offered, the process was simple. EDX handled all the administration, warehousing, logistics, sales, and account receivables, a full turnkey solution.
To maximize asset recovery value, EDX utilizes a unique targeted marketing approach, leveraging a global sales infrastructure that is backed by over 25 years of global commodity management expertise.
Utilizing a unique in-depth approach, EDX is able to define target market segments that have a demand for your product and then consult with your team on market options available. We take every step to maximize your total asset recovery value and velocity, all while minimizing overall risk.
What has been your worst experience with excess inventory?
What is your process to deal with excess?